ABTA has been told it needs to face up to its total travel
insurance regulatory responsibility following the provisional
liquidation of broker Whiteley Insurance.
The Financial Services Authority forced Whiteley Insurance into
provisional liquidation last week after the broker was found to be
selling travel insurance not covered by an underwriter. It means
there are hundreds of thousands of holidaymakers who believe they
are covered by their travel insurance policies when they are not.
It is not clear how many of those affected bought their policies
through the trade.
Rival company Rock Insurance managing director Jeff Rush has warned
the travel industry there’s a raft of insurance brokers
offering cover that is not underwritten.
As travel insurance sold through the trade is regulated by ABTA and
not the FSA, Rush has urged Newman Street to issue an ABTA
underwriters’ stamp so agents can sell insurance with
confidence.
“ABTA is doing a good job in training but needs to get its
act together with suppliers. The Whiteley experience shows there
are traders out there that do not have the right underwriters
behind them,” he said. “ABTA must ask who the
underwriters are.”